After just six weeks Canada's Conservative minority may be brought down by its own hubris

Canada’s six-week old government could be the main casualty of the country’s economic downturn, and will have only itself to blame.

The Conservative minority government in October forced the country into its third election in five years, hoping to pull off a majority. Instead for the grand cost of $300 million it won a few more seats, but was sent back to Ottawa still below the 50 percent mark.

Fast forward to the first fiscal update on Friday and Stephen Harper just couldn’t help himself. He used the global economic crisis to hammer his political opponents by wiping away the taxpayer subsidy paid to political parties, froze public service and politicians' pay rises and suspended the right of public servants to strike for the next couple of years – despite postal workers being on strike right now.

The rationale is beautiful. If ordinary Canadians have to tighten their belts then the government needs to look in the mirror and do likewise.

Where good old Machiavelli creeps into the equation is not the move to keep the clamps on pay, but with the subsidy of $1.75 paid to political parties for each vote they garner in an election.

Whether or not you agree with such a subsidy isn't the issue. Harper is using an economic crisis to pull off an ideological maneuver his party will emerge from the least scathed.

On the figures from the last election Harper’s Conservative Party was eligible for $10m through the subsidy, the Liberals $7.7m, the NDP $4.9m, the Bloc Quebecois (which only stands candidates in Quebe) $2.6m and the Greens (who failed to have any MP elected) $1.8m. Seems like the Conservatives give up the most... but statistics are so cute when you need them to be.

As a percentage of what the party can raise, it is the Conservatives that give up just 37% - all other parties give up between 57% and 65% of their total revenue making campaigning for another election very, very unattractive. The Conservative Party has a far more solid financial base than its foes and it intends to use it.

The fiscal update is more than wiping out the taxpayer subsidy. It is an attack on the political process on top of an assault on workers’ rights. Added to that, there was an announcement that pay equity settlements that the Conservatives have deemed “litigious and adversarial” are also now a no-no.

For a very thin fiscal update, it was laden with talk of how dire the world economic crisis is. It dripped of dramatic downturns, warned of prolonged contraction, or serious management flaws abroad and dangerous shortsightedness. Finance Minister Jim Flahrety talked big about sudden and devastating effects on the rest of the world, and then crowed about how Canada may technically be in a recession yet the next two years will produce razor thin surpluses.

This was apparently a good excuse to chop his political opponents off at their wobbly knees, but the razor may in fact cause the most damage to the Conservative government itself. It seems the wobbly knees have begun to stabilize.

The joke about Canadian politics goes along the lines of “why did the Canadian cross the road? To get to the middle”. The middle could soon be very ugly for Harper’s cocky regime.

The fiscal update – if it can really be called such – may prove to be a very costly political calculation because it is a confidence measure, and confidence measures that fail have a nasty habit of bringing down governments.

Harper seems to have bet his chips on the unpalatablity of yet another election forcing the acquiescence of his political foes. Not this time. The Liberal party during the last administration suffered the ignominy of having to go along with Harper because it was not in a position to fight an election should it force one to be called.

It seems the Opposition parties have been doing some scheming of their own, and with all three declaring immediately they will vote against the fiscal update there’s a new buzz in politics.

There have been rumours – the delicious foundation of politics – for the last ten days or so that the Liberals and the NDP could form a plausible working coalition, and the Bloc while not officially part of that team, would lend its support on confidence measures.

That means they are quite prepared to go to the Governor General and present as an alternative government should she decide to send Harper and his team packing to the Opposition benches.

We are all now waiting to see how Harper can get himself out of this one and save face. It is all very well to rant on and on about how careful and considered and conservative economic management has left Canada in the best position when compared to any of its G7 (or G8) mates. It is quite another situation to use the charade of belt-tightening to implement draconian measures for public servants and to inflict relatively major economic pain on political opponents for what, in the great scheme of things, amounts to a petty few dollars.

But overall the greatest cry from the opposition parties in Canada is why, when the rest of the world is working to stimulate their respective economies is Harper so sure that his reduction in GST last year is enough of a stimulus to date? Why is Harper, who a few weeks ago called deficits stupid, now obviously paving the way for the prospect of deficits in a few years time?

The calculation is obviously that Canada will plough on through and Harper will be a god – small g – and the country will fall to his feet praising him for such economic management. Zero to Hero stuff.

Fat lot of good it will do him however if the Governor General agrees to hand over the treasury benches to an opposition combo. Now who was it that told me Canadian politics is boring?

Comments (6)

by Steve Barnes on November 29, 2008
Steve Barnes

Indeed, Canadian politics is far more interesting than one would expect!

I'm curious about how the Conservatives actually fund their election campaigns. As I understand it, Canada has some pretty tough electoral finance laws - no business or union donations allowed and individual donations capped (but indexed) at around $1,000.

So how can even the Conservatives afford elections? Do businesses funnel funds through employees who make 'individual' donations? Surely they can't have an exceptionally large membership either, given how frequently the Conservatives sit on the Opposition benches?

by Jane Young on November 29, 2008
Jane Young

Canadian Prime Minister Stephen Harper has been spooked by the prospect of defeat, and has just announced Monday's vote will now be held on December 8  Harper has now fired the starting gun for  a massive push to try and convince one of the three opposition parties to move back from the brink. One possibility is to promise the NDP a programme such as a bail-out type package for the auto industry in Canada which is, percentage wise, a more significant employer than the auto industry in the US.

Whatever Harper does, the credibility of his Finance Minister is now in tatters, and major question marks now hover over his own reputation as an extremely clever, albeit calculating, politican.

by Conor Roberts on December 01, 2008
Conor Roberts

I see the Conservatives have backtracked on right to strike and campaign subsidies. And have brought forward the budget date to 27 January.


by Conor Roberts on December 02, 2008
Conor Roberts

And now it looks like the opposition parties have signed a coalition deal. Interesting...

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